Speaker Kevin McCarthy, R-Calif., said Monday that House Republicans will vote on a bill "in the coming weeks" to lift the debt ceiling for one year while capping federal spending at the fiscal year 2022 level.
Addressing business leaders at the New York Stock Exchange, the California Republican also said the bill would limit subsequent spending increases to just 1% per year over a decade.
"Let me be clear: a no-strings-attached debt limit increase cannot pass. But since the president continues to hide, House Republicans will take action," McCarthy said, noting the White House's refusal to negotiate a package that includes a debt ceiling hike and spending limits.
"Here’s our plan: In the coming weeks, the House will vote on a bill to lift the debt ceiling into next year, save taxpayers trillions of dollars, make us less dependent on China, and curb high inflation — all without touching Social Security or Medicare," he said. "Simply put, it puts us on a responsible fiscal path in three ways: limit, save, and grow."
WALL STREET SHOULD BE 'CONCERNED' ABOUT DEBT LIMIT STANDOFF WITH BIDEN: MCCARTHY
McCarthy claimed discretionary spending, which is money that is approved each year by Congress through spending bills that are then signed by the president, had surged 17% over the last two years.
Late last year, congressional Democrats approved a fiscal year 2023 spending bill that included $134 billion more in non-emergency spending compared to the prior year, according to the Committee for a Responsible Federal Budget. That overall 9% increase included significant boosts for defense, veterans and other areas.
McCarthy said Congress has showed before that the federal government can operate in under more moderate spending limits.
"From 2011 through 2021, the federal government operated under binding spending caps. Though these caps occasionally changed because of bipartisan debt limit negotiations, they were largely successful: discretionary spending flatlined and overall spending growth slowed dramatically," McCarthy said. "Our legislation accomplishes the same goal by returning the federal government to 2022 spending levels — and then limiting the growth of spending over the next 10 years to 1% annual growth."
FLASHBACK: TREASURY SEC. YELLEN DIDN'T 'BELIEVE' SHE’D SEE ANOTHER FINANCIAL CRISIS IN HER LIFETIME
McCarthy also indirectly hit back at Senate Majority Leader Chuck Schumer, D-N.Y., for calling House GOP proposals "draconian."
"Don’t believe anyone who says these are draconian limits. They’re the same spending levels we operated under just last October. And we make sure that our veterans and our service members are taken care of," McCarthy said.
President Joe Biden and Senate Democrats are refusing to tie spending cut talks to the debt ceiling – something conservatives have demanded – and insist that Congress should raise the government's borrowing limit without conditions.
MCCARTHY SAYS BIDEN 'COMPLETELY MISSING IN ACTION' ON DEBT LIMIT NEGOTIATIONS
McCarthy made it clear during his speech that his majority will continue to push for a negotiation even as the House pursues its own spending limits.
"Join us in demanding a reasonable negotiation and responsible debt ceiling agreement that brings spending under control, and if President Biden decides to stop the partisan games and stand with us, then our majority will join with him in common cause to address this urgent challenge," the Speaker said.
Even before McCarthy took to the podium, the White House indicated it would not budge and accused Republicans of looking to impose harsh spending cuts.
"A speech isn’t a plan, but it’s clear that extreme MAGA Republicans’ wish lists will impose devastating cuts on hardworking families, send manufacturing overseas, take health care and food assistance away from millions of people, and increase energy costs — all while adding trillions to the debt with tax cuts skewed to the super-wealthy and corporations," White House spokesman Andrew Bates said Monday.
In a show of support from the rightwing flank of his party, the House Freedom Caucus-aligned group FreedomWorks praised McCarthy after the speech.
"Now is the time for President Biden and Senate Democrats to come to the table with House Republicans to find a compromise in the debt limit debate. Our nation’s catastrophic debt can no longer be a partisan issue," FreedomWorks President Adam Brandon said.
